Brexit has been all over the news again, with the British
Prime Minister announcing her negotiating plans and MPs voting to trigger the process
by the end of March. A 77-page White Paper released on 2 February has also
spelled out the government’s intended approach.
But are we any closer to knowing how Brexit might affect expatriates
or British property-owners in Europe?
While there is still much uncertainty, we are optimistic
that Britons will continue to enjoy the benefits of owning property and living
in Europe. Here is what we do know.
The UK is likely to leave
the single market
Theresa May revealed her Brexit vision is that Britain
"cannot possibly" remain in the European single market. She perceives the free
movement of goods, services and people as incompatible with the Brexit objectives
of gaining control over British borders and decision-making.
Instead, she wants to achieve the "freest possible trade"
with EU countries in a "new and equal partnership". Ruling out any
arrangement "that leaves us half-in, half-out", it is unlikely Britain
will accept the Norwegian approach of remaining in the wider European Economic Area.
This means that the current benefits of EU membership will most
likely be negotiated one-by-one after Article 50 is triggered - a process that
will take at least two years. In the meantime, your access to Europe as an EU
member is unaffected.
Expatriate rights "remain
Reassuringly, the government has said "the right and fair
thing to do" is to give expatriates on both sides "the certainty they want and
reach a reciprocal deal with our European partners at the earliest
However, the White Paper claims that their early efforts to
secure access to healthcare for Britons living in Europe had "not proven
possible". May had previously suggested that many EU countries wanted to agree a
deal now but "one or two others do not". However, EU spokespeople claimed
there is "complete unanimity" among the 27 EU states that no such agreements
could possibly take place until Article 50 is triggered.
So again, everything depends on what is agreed during the negotiation
period. Until we know if agreements will maintain benefits like healthcare, expatriates
should explore alternative arrangements like private health insurance.
The Brexit deal must
be agreed by Parliament
The Supreme Court ruled that May must get Parliamentary approval
before kick-starting Brexit with Article 50. In response, the government
hastily released a bill to gain the consent it needs to trigger Brexit before
May's promised deadline of 31st March. They got their wish when the
majority of MPs voted in favour of beginning the Brexit process. However, some
were unhappy the vote took place the day before the government issued the White
Paper to flesh out their plans.
Does this mean that the Prime Minister's vision of Brexit will
become a reality? While the ‘when' may be more certain, the ‘how' is still
under debate. With much to be agreed between MPs, the House of Commons and House of Lords,
it remains to be seen how many of May's ambitions can be met.
However it is carried out, at this stage the UK is on track
to leave the EU in summer 2019.
What does this mean
While we can most likely expect a clean break with the EU
rather than a softer approach, there are still many unknowns. This will be
unsettling for those living in or planning to move to Europe, but the fact is
that little has changed since the Brexit vote. There are still at least two
years before changes to your EU membership can be implemented.
There are ways to potentially make things easier. Many UK residents
thinking of moving abroad are taking steps to secure residency there sooner
rather than later. Those already living there may benefit from applying
for citizenship. It may also be worth reviewing whether to transfer UK
pensions to take advantage of current opportunities before Brexit takes effect.
In any case, be prepared for Brexit developments to continue
to cause uncertainty for currencies and investment markets. Those considering
buying property abroad, for example, may need to revise short-term expectations
of what their British pounds can buy. At times like this, it is more important
than ever to have a well-diversified investment portfolio that is not
overly-weighted to sterling, and consider multi-currency arrangements to ride
out any turbulence.
For expatriates and Britons owning property in Europe, there
has never been a better time to review
your financial planning and explore
your options. An adviser with
specialist cross-border experience will be best placed to keep you
up-to-date with developments and ensure you take appropriate action as Brexit
David Bowern, Partner, Blevins Franks
This e-mail address is
Tel: 952 809 212
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